Ben Bernanke sends gold and silver prices soaring

Hard to imagine that a single man can affect the gold and silver prices per ounce so much.

However, the truth is that Ben Bernanke has sent the gold and silver prices per ounce to a new high.

What did he do?

Actually he did nothing much except saying a few words.

His remarks and hints about further stimulus is enough to sink the Dollar and soar the gold and silver prices per ounce.

Why is that so?

Further stimulus means devaluing the Dollar by having more money floating around.

Since gold and silver prices per ounce are in inverse direction to the value of the Dollar, the price will soar.

Even people without knowledge of finance knows that a devalued currency is not good for them.

In order to retain the value of their money, they would buy gold and silver to prevent further erosion of their money.

The fact that a single remark by Ben Bernanke is enough to affect the commodity market means that the investors are extremely fearful.

They react very fast to bad news.

Once the Fed announces the stimulus, the gold and silver prices per ounce will reach the sky.

That is the time when the common people react by snapping up physical gold and silver.

It seems that the underlying factors supporting the precious metals will not go away in the future.

The debt problem of Greece and Italy will take years to go away.

Even if they can reach a settlement, that is just the beginning of debt management.

The sovereign debt problem of United States is even worse.

It seems that US will take a few hundred years just to pay off the debt.

The interest that the US is going to pay the holders of the Treasury bonds is enough to keep the tax rate high.

It seems that US will keep on printing money until the value of US government bonds is next to nothing.

That means the gold and silver prices per ounce will continue to go up.

The days of $4 per ounce of silver are long gone.

Not many people can remember that gold price per ounce was about $37 in 1970.  They might not even remember that they could have bought gold for $273 in 2000.

Just a difference of 11 years, and gold price has increased nearly 6 times.

Those old, good days are over.

The question is: how high will the gold and silver prices per ounce go?

It seems that the sky the limit.
We might not even have the ability to buy silver in another ten years’ time.